HomeMy WebLinkAbout06-10-08•
IN RE:
ESTATE OF HOWARD
C. GALE
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IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
ORPHANS' COURT DIVISION
NO. 1998-629 ORPHANS' COURT
TRANSCRIPT OF PROCEEDINGS
Proceedings held before the HONORABLE J. WESLEY OLER, JR., J.
Cumberland County Courthouse,
Carlisle, Pennsylvania,
On March 13, 2008,
In Courtroom Number 1.
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APPEARANCES:
Bret Keisling, Esquire
Stephen C. Nudel, Esquire
For Petitioners
Adam L. Seiferth, Esquire
For the Respondent
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INDEX TO WITNESSES
FOR PETITIONERS DIRECT CROSS REDIRECT RECROSS
Howard C. Gale, Jr. 6 49 -- --
Julie F. Gale 57 -- -- --
as on cross
INDEX TO EXHIBITS
FOR THE PETITIONERS MARKED ADMITTED
1 - Last Will and Testament 5 7
2 - House Lease 14 56
3 - House Lease 17 56
4 - House Lease 19 56
5 - House Lease 20 56
6 - House Lease 21 56
7 - Certificate of Registration 27 56
8 - House Lease 32 56
9 - Apartment Lease 32 56
10 - Lease agreement 32 56
11 - Lease Agreement 32 56
12 - Lease Agreement 32 56
13 - Lease Agreement 32 56
14 - Lease 32 56
15 - Lease Agreement 32 56
16 - Lease Agreement 32 56
17 - Apartment Lease 32 56
18 - Apartment Lease 32 56
19 - Apartment Lease 32 56
20 - Apartment Lease 32 56
21 - Apartment Lease 32 56
22 - Apartment Lease 32 56
23 - Lease Agreement 32 56
24 - House Lease 32 56
25 - Lease Agreement 32 56
26 - Lease Agreement 32 56
27 - Apartment Lease 32 56
28 - Apartment Lease 32 56
29 - Apartment Lease 32 56
30 - Residential Lease 32 56
31 - Lease 32 56
32 - Apartment Lease 32 56
33 - Assessments 65 67
34 - Inheritance Tax Return 67 71
35 - Tax return 74 89
36 - Tax Return 74 89
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37 - Tax Return
38 - Tax Return
39 - Tax Return
40 - Tax Return
41 - Tax Return
42 - Tax Return
43 - Tax Return
44 - Tax Return
45 - Tax Return
46 - Tax Report
47 - Tax Report
48 - Tax Report
49 - Tax Report
50 - Tax Report
51 - Tax Report
52 - Tax Report
53 - Tax Return
54 - Last Will and Testament
55 - Cert ificate of
Incorporation
FOR THE RESPONDENT
1 - Lease Agreement
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74 89
74 89
74 89
74 89
74 89
74 89
74 89
74 89
74 89
81 81
81 81
81 81
81 81
81 81
81 81
81 81
81 84
84 89
88 89
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51 53
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1 March 13, 2008
2 Carlisle, Pennsylvania
3 (The following proceedings were held at 1:54 p.m.)
4 THE COURT: This is the time for a hearing on a
5 Petition for Declaratory Judgment in the Matter of the Estate
6 of Howard C. Gale. Go ahead.
7 MR. KEISLING: Thank you, Your Honor. My name is
8 Bret Keisling, and with me today is Stephen C. Nudel, and we
9 represent the Petitioners in the matter you referenced.
10 The matter before the Court today involves five
11 disputed properties. There were nine properties that were part
12 of the will of Howard C. Gale, Sr., that were ultimately to
13 pass on to his grandchildren and step-grandchild.
14 Five of the properties, however, have come into
15 dispute between the estate and the Petitioners as to whether
16 the properties are properly part of an entity and will pass on
17 to the grandchildren.
18 We are prepared today to introduce significant
19 overwhelming evidence that these properties were, in fact, part
20 of the entity and have always been treated as such and,
21 therefore, should pass on to the grandchildren and
22 step-grandchild.
23 THE COURT: Very good.
24 MR. SEIFERTH: Your Honor, Adam L. Seiferth for the
25 Respondent, Julie Gale. Just very briefly, I think the clear,
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solid, undisputed evidence in this case is that the deeds to
these five properties in issue were to an entity called Country
Club Park, Inc., that entity subsequently merged into a company
known as Howard C. Gale Development Company, Inc. Based on
those deeds, the letters documenting the merger, the articles
of incorporation documenting the merger, and the clear
unambiguous reading of the will that provides that the
Respondent is to receive all of the assets of the Howard Gale
Development Company, makes this a very clear case. And I
suspect that the evidence the Petitioners intend on presenting
are at best circumstantial and most likely inadmissible.
THE COURT: Okay. Mr. Keisling.
MR. KEISLING: Your Honor, would you like us to
discuss the admissibility of the evidence beforehand or just
present our case?
THE COURT: No, just proceed. If there is an
objection, we will deal with it at that time.
MR. KEISLING: I would like to call to the stand
Howard Gale, Jr., please.
(Witness sworn.)
MR. KEISLING: May I approach?
(Petitioner's Exhibit No. 1 marked for
identification.)
MR. KEISLING: What I am presenting to the witness
is just the will of Mr. Gale, so we have a frame of reference
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and so that is certified. We are also prepared, Your Honor, if
you would like, we have a notebook of all of the exhibits for
your convenience.
THE COURT: I would prefer to wait until they are
admitted.
MR. KEISLING: Thank you, sir.
HOWARD C. GALE, JR.,
having been duly sworn, testified as follows:
DIRECT EXAMINATION
BY MR. KEISLING:
Q Mr. Gale, could you state for the record your name,
please?
A Howard C. Gale, Jr.
Q Your address, sir?
A 1440 Waterford Drive, Camp Hill, PA.
Q Do you recognize the document that I just handed to
you?
A I do, yes.
Q What is that document?
A This is my father's last will and testament.
THE COURT: How has that been marked?
MR. KEISLING: It has been marked as Exhibit 1,
Your Honor.
THE COURT: Whose Exhibit 1?
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MR. KEISLING: Petitioner Exhibit 1.
THE COURT: All right.
BY MR. KEISLING:
Q If you flip to the last page of the will, do you
recognize the signature?
A Yes.
Q Is t hat your father's signature?
A That is my fa ther' s signature.
MR. KEISLING: If there is no disagreement from the
other side, we w ill admit the will.
MR. SEIFERTH: No objection, Your Honor.
THE COiJRT: N o obj ection to what?
MR. KEISLING: We would move to admit the will as
Exhibit 1.
THE COURT: Petitioner's Exhibit 1 is admitted.
BY MR. KEISLING:
Q Mr. Gale, were you employed by your father during
his lifetime?
A I was, yes.
Q What entity employed you?
A The entities were County Club Park, Inc.; Gale
Development Company; Howard C. Gaffe, Inc.; and Country Club
Park Development Company, Incorporated.
Q Was there one entity in particular where you
received your paychecks from?
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A Mainly from Gale Development Company, Inc.
Q However, you performed services on behalf of all
four entities?
A Tk'iat is correct.
Q Were there strong corporate divisions between the
different entities?
A Not really. No. My father was controlling and he
knew in each corporation. what he was doing.
Q When did you start working for your father, sir?
A I started with the companies in May of 1962.
Q How long were you employed by your father?
A I was employed approximately 1990.
Q Did you have a particular job title, sir?
A I had many titles because being that it was small
corporations, we built homes, we sold our own homes, we had
apartments which I would help lease and run.
When my father. was out, often up to 90 days, I
would take care of the maintenance of all of the properties.
Q Did you differentiate as you went through all these
different job tasks for which corporation you were working for
at any given time?
A No, they ali ran together.
Q So essentially you just worked for your father?
A That is correct.
Q Was there anyone other than your father who exerted
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complete control over each of the companies?
A No, my father. was the only one.
Q So any decision. related to any of the companies
your father exerted control during his lifetime?
A That is correct.
THE COURT: Was he the sole shareholder?
THE WITNESS: Of the corporations, Robert J. Trace
was secretary; I was vice-president of the Gale Development
Company; and I think Margaret Trace, Robert Trace's wife, was
also an officer of the corporations.
THE COURT: How about the shareholders?
THE WITNESS: The shareholders were mainly -- my
father was the shareholder. Although, at one time I had shares
in Gale Development Company, Incorporated.
MR. KEISLING: Your Honor, one of our later
exhibits, and. we can bring it now or wait until later, but we
will show for the Court's information when the company was
formed in 1956. This is Country Park Development.
THE COURT: That iS fine. If you are going to have
evidence on that, I will be glad to hear it.
MR. KEISLING: There was one share each from
Mr. Trace.
THE COURT: I don't know that. We wil_1 wait for
the evidence to come in.
MR. KEISLING: Thank you, sir.
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BY MR. KEISLING:
Q Did there come a time when Howard Gale Development
Company, Inc., and Country Club Park, Incorporated, merged?
A Yes.
Q Do you recall the merger at the time that it
occurred?
A I think the merger occurred somewhere around
between 1970 and 1973. The Country Club Park, Inc., was merged
into Gale Development Company, Incorporated.
Q Were you aware at the time that the merger took
place why it took place?
A The main reason that it took place is because the
accountant said it would be better to incorporate some of these
things for tax purposes. My father was always wanting to do
things in order to save taxes.
Q At the time of the merger you had testified that
you would have been employed by your father from anywhere from
6 to 10 years, depending on when the merger took place?
A That is correct.
Q Did your job description or anything in the way you
did your job charge after the merger from how you did it before
the merger?
A Not at ali.
Q So it was a corporate structure change of some kind
that did not effect your day-to-day operations?
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A That is ccrrect.
Q To your knowledge, did your father change anyway he
operated post merger as opposed to how he conducted business --
A Not at all.
Q Are you familiar with the properties that are the
subject of this dispute?
A I am.
Q I would like to show a list of the properties.
This we are not going to admit, I have already shown opposing
counsel, it is just for information purposes.
This just lists the properties, Your Honor. I
don't know if you would like a copy, sir.
THE COURT: Not until it is admitted.
BY MR. KEISLING:
Q Does this 1_ist properly reflect the properties in
dispute to your knowledge, sir?
A It does, yes.
Q Could you just read the list for the record of the
disputed properties, the addresses, slowly for the court
reporter to get?
A 6 Fargreen Road, Camp Hill; 55 Circle Drive, Camp
Hill; 22 Country ~~lub Place, West Camp Hill; 49 Circle Drive,
Camp Hill; and 530 Fairway Drive, Camp Hill.
Q We have four properties listed under undisputed
properties?
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A Yes.
Q Just those addresses, sir?
A The undisputed properties are 7 Fargreen Road, Camp
Hill; 520 Colony Road, Camp Hill; North 32nd Street, East
Pennsboro, which was a lot; and. a Chestnut Street lot in Camp
Hill.
Q Is it your understanding that the properties that
are listed as undisputed are undisputed because the trust
already has control of those properties or the proceeds from
them?
A That is correct.
THE COURT: What trust are you talking about?
MR. KEISLING: This is the trust that is referenced
in paragraph four of the will, sir. The assets of -- Mr. Gale,
Sr.'s, interest in Country Club Park Development was placed in
trust with Robert Trace. Mrs. Gale, the Respondent, is the
beneficiary of the trust in her lifetime. So that is the trust
that is at the heart of this dispute and what assets are
entered into the trust.
THE COURT: All right..
MR. KEISLING: And by the way, Judge Oler, this
Court recently ruled, and I believe Your Honor dial it, to
transfer certain of the assets into the trust where Jim Hughes
is the Trustee. So the matter has been before the Court
further all to this declaratory judgment action.
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BY MR. KEISLING:
Q Mr. Gale, did your father lease any apartment units
during his lifetime?
A Yes, he did.
Q Do you see the apartment units referenced on the
list that you just read?
A I do, yes.
Q Your father also leased a home that wasn't an
apartment per se but was also a leased property?
A That is correct.
Q Would it be correct to say that the apartment units
and the house that your father leased to others are the
properties that are comprised of the disputed properties on the
list you just read?
A That is correct.
Q So each of those properties were properties that
your father handled on a lease basis rather than selling?
A That is correct.
Q Do you know through what entity your father leased
all of these apartments or the house?
A These were all leased through Country Club Park
Development Company, Incorporated.
MR. KEISLING: If I may approach, Your Honor, with
Exhibit 2. This will be Petitioner's Exhibit No. 2.
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(Petitioner's Exhibit No. 2 marked for
identification.)
BY MR. KEISLING:
Q Mr. Gale, do you recognize the document that I just
gave you that is marked as Petitioner's Exhibit 2?
A I do.
Q Can you tell me what that document is?
A This is a standard lease.
Q For what property does that document lease?
A This property is for 6 Fargreen Road, Camp Hill.
Q That is one of the properties on the disputed
property list?
A That is correct.
Q Who is the lessor, the landlord on that lease?
A The landlord on this is Country Club Park
Development Company, Incorporated.
Q Who is the tenant?
A The tenant, the last name was Vangenhassend.
Q Did you know this tenant, sir?
A I did, yes.
Q We are going to bring a number of leases in. Did
you generall y know the tenants of these properties while you
were employed with the company?
A Yes.
Q On what basis? How did you come to know the
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1 tenants?
2 A I knew them because if there was ever anything that
3 had to be done, particularly if my father wasn't around, I took
4 care of it with the work force that we had.
5 Q So you were personally and ultimately familiar with
6 all of the tenants and all these properties?
7 A Absolutely.
8 Q Was there ever any question in your mind that it
9 was Country Club Park Development Company, Inc., that was the
10 landlord and the lessor of these properties?
11 A There is no question --
12 MR. SEIFERTH: I object, Your Honor. I don't think
13 there is any foundation for him to provide his opinion as to
14 who the lessor or lessee was with any particular property.
15 The only testimony I have heard is that Mr. Gale
16 performed some maintenance duties that involved the building of
17 houses. It wasn't his secretary that was intimately involved
i8 in any of the corporations in terms of bookkeeping.
19 THE COURT: Wouldn't the lease speak for itself as
20 to who the landlord is?
21 MR. KEISLING: We are certainly willing to let it
22 speak for itself, Your Honor, we will withdraw the question.
23 THE COURT: All right.
24 BY MR. KEISLING:
25 Q Could you icok to the final page of the lease and
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tell me who signed the lease?
A My father signed the lease, Howard C. Gale,
President, on behalf of Country Club Park and Development
Company, Incorporated.
Q There were a number of handwritten notations on the
lease, do you recognize those?
A I do.
Q Do you recognize the handwriting of those
notations?
A They are my father's handwriting.
Q Can you just explain for the record what those
notations represent?
A These notations represent the lessee when the
lessee would pay rents. He would mark on the lease itself that
-- when they would pay it and when they were paid up.
Of course, the one we were looking at went from
1977 to 1993. One of the things we tried to do is to keep
tenants in place, so we took care of the properties very well.
THE COURT: Are these all residential properties?
THE WI'T'NESS: Yes, they were. They were resident
two-unit apartments that looked like a Cape Cod house on the
outside. But when you walked inside, Your Honor, one door
would open -- they had two doors. One would go to the
apartment on the first floor and another door to the apartment
on the second floor.
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THE COURT: All right.
BY MR. KEISLING:
Q Generally, geographically, where were the
properties located?
A They were located throughout Country Club Park,
Incorporated, which was a mixture of residential and these
apartment units.
Q Ire terms of what neighborhoods so the Court would
understand?
A This was Country Club Park, which is to the west of
the West Shore Country Club.
Q Thank you, sir.
MR. KEISLING: Your Honor, if I may approach again,
we have 34 leases. We are not going to go through them all
individually, but just a couple to show the different
properties. We will stipulate as to them, but if we could
approach with a few more.
THE COURT: Certainly.
MR. KEISLING: This is Petitioner's Exhibit 3.
(Petitioner's Exhibit No. 3 marked for
identification.)
MR. KEISLING: Your Honor, I apologize for asking
this question, but would you like me to wait? I am planning to
admit all the exhibits at the end of the presentation. Should
we let them pile here'?
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1 THE COURT: That is up to you. I don't want to
2 tell you how to present your case.
3 MR. KEISLING: I want to follow the Court, sir,
4 thank you.
5 BY MR. KEISLING:
6 Q Do you recognize the documents that I handed you?
7 A I do, yes.
8 Q It is marked at the bottom, Petitioner's Exhibit
9 No. 3?
10 A Yes.
11 Q What is that document?
12 A That is another one of our leases.
13 Q Can you tell me the date on that lease?
14 A The date on this lease was the 1st day of August
15 1986.
16 Q Was this also during the period you worked for your
17 father?
18 A That is correct.
19 Q What property is represented on the lease?
20 A This is 55 Circle Drive, 2nd floor.
21 Q Is that also one of the disputed properties?
22 A That is.
23 Q Who is the lessor on that lease?
24 A Country Club Park Development Company,
25 Incorporate d.
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1 Q The tenant, sir?
2 A The tenant's last name was Labenbach.
3 Q Who signed the lease for the landlord if you
4 recognize the signature?
5 A My father signed it for Country Club Park
6 Development, Inc.
7 Q Could you read what the signature says, just his
8 name and title?
9 A Country Club Park Development Company, Inc., Howard
10 C. Gale, President.
11 Q Do you recognize the handwritten notes on that
12 lease as well?
13 A I do.
14 Q That is similar to what you described before as
15 essentially an accounting system?
16 A That is correct.
17 Q Okay, thank you.
18 I would like to approach with Petitioner's Exhibit
19 No. 4, Your Honor.
20 (Petitioner's Exhibit No. 4 marked for
21 identification.)
22 BY MR. KEISLING:
23 Q Mr. Gale, do you recognize the document that I just
24 handed you there?
25 A I do.
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1 Q What is that document?
2 A This document is another one of our standard
3 leases.
4 Q Who is the landlord?
5 A The landlord is Country Club Park Development
6 Company, Inc.
7 Q What is the date on that lease?
8 A The lease is dated the 1st day of October, 1981.
9 Q The date of the lease just at the top so that there
10 is no confusion later?
11 A The 1st day of September 1981.
12 Q That is the date executed which your reference was
13 the date the lease took effect.
14 A The lease took effect.
15 Q Who is the landlord here?
16 A The landlord is Country Club Park Development
17 Company, Incorporated.
18 Q Who signed the lease?
19 A Howard C. Gale, President.
20 Q For what entity was he president?
21 A Country Club Park Development Company, Inc.
22 Q I will approach with Petitioner's Exhibit No. 5.
23 (Petitioner's Exhibit No. 5 marked for
24 identification.)
25 MR. KEISLING: Your Honor, I apologize for the
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1 tedious nature of this. We are looking to bring the lease in
2 for each property, and then we will bring the bulk in
3 simultane ously.
4 THE COURT: All right.
5 BY MR. KE ISLING:
6 Q Mr. Gale, do you recognize the document marked as
7 Petitione r's Exhibit No. 5'?
8 A Yes.
9 Q What document is that?
10 A This is another one of our standard leases.
11 Q Who is the landlord, sir?
12 A The landlord is Country Club Park Development
13 Company, Incorporated.
14 Q What is the date of the lease, sir?
15 A The date of the lease was the 20th of January
16 1977.
17 Q Do you recognize the signature on that lease?
18 A I do.
19 Q Tell me who signed the lease?
~0 A My father, Howard C. Gale, President cf Country
21 Club Park Development Company, incorporated.
22 Q Thank you, we have one more. I will approach with
23 Petitione r's Exhibit No. 6.
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25 (Petitioner's Exhibit No. 6 marked for
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identification.)
BY MR. KEISLING:
Q Mr. Gale, do you recognize the document identified
as Petitioner's Exhibit No. 6?
A I do.
Q What is that document, sir?
A This is another one of the standard leases.
Q Who is the landlord on that lease, sir?
A Country Club Park Development Company,
Incorporated.
Q What is the date of that lease, sir?
A This was tree 27th of July 1964.
Q 1964 was also during your employment with the
company?
A That is correct.
Q If you could just review the signature on that
lease, do you see the signature, sir?
A The signature is somewhat blacked out, but it is
Howard C. Gale.
Q The signature is blocked out, you are correct, and
it is blocked out -- could you explain why it is blocked out,
sir?
A The reason it is blocked out, this young lady moved
in, in 1964, and the lease ran until 1998, so the writing on
the lease got so full that my father added a piece of paper
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1 that covered his signature. But it is Country Club Park
2 Developmen t Company, Inc.
3 Q If you. could turn the page, sir.
4 Again, we are happy, Mr. Seiferth, to bring this up
5 with Mrs. Gale as a witness, but there is a document attached
6 that is a lease extension. Do you see that document, sir?
7 A I do.
8 Q Can you tell me what the "RE:" on that, what it
9 says, just to identify the document?
10 A It is the lease renewal for Shirley Yarnell, 7
11 Fargreen R oad.
12 Q Is Mrs. Yarnell the tenant on the primary lease at
13 Exhibit 6 that you just read?
14 A Yes.
15 Q So this is renewing her lease. What is the date of
16 the renewa l, sir?
17 A September 1 of '98.
18 Q This was some 34 years after the original lease
19 approximat ely was signed?
2G A Correct.
21 Q Do you recognize the signature of the renewal?
22 A Of the renter.
23 Q Sorry, of the landlord?
24 A The landlord, yes.
25 Q Whose signature is that?
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1 A Julie Gale.
2 Q Did you have an opportunity during either your
3 employment with the company or during your personal
4 relationship with Ms. Gale to come to recognize her signature?
5 A Absolutely.
6 Q So you are confident that that is her signature?
7 A Absolutely.
8 THE COURT: Did she sign simply in her individual
9 capacity?
10 THE WITNESS: In this case she signed as
11 Mrs. Howard C. Gale, President, which would have been of
12 Country Club Park and Development Company, Incorporated.
13 BY MR. KEISLING:
14 Q Could you just read, do you see the paragraph that
15 begins this agreement?
16 A Yes.
17 Q Could you just read that sentence?
18 A This agreement regarding your apartment lease shall
19 be attached to and be made part of your original lease dated
20 9/1/1964.
21 Q Go ahead and read the first sentence of the next
22 paragraph?
23 A All conditions shall remain the same, except party
24 of the second part shall now pay for their sewer rent, East
25 Pennsboro Township, $49.50. This brings the total of your
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1 sewer and trash to $87.75.
2 Q Fine. Thank you, Mr. Gale.
3 This is dated May 15, 1998. Can you tell the Court
4 the date of your father's passing, sir?
5 A He passed away January 19, 1998.
6 Q So this is some four months after his passing?
7 A That is correct.
8 Q In response to the Court's question you answered
9 the signa ture again says, could you read the whole signature
10 line?
11 A It says Mrs. Howard C. Gale, President, Julie F.
12 Gale.
13 Q It doesn't make any reference to a change in
14 corporate entity from the original lease which was Country Club
15 Park Deve lopment Company, Inc.?
16 A That is correct.
17 Q To your knowledge, and we are happy to bring this
18 up with Mrs. Gale, but tc your knowledge at this time was Mrs.
19 Gale, in fact, president of Country Club Development Company,
20 Inc.?
21 A At that time, yes.
22 Q Which she came into that position after your
23 father's passing?
24 A That is correct.
25 Q Turn the page vne more page. This is a document
25
• •
1 dated 1989, is that correct?
2 A That is correct.
3 Q Can you give the date of the document?
4 A August 15, 1989.
5 Q What document is this?
6 A This is the lease renewal.
7 Q So this is a previous lease renewal than the one we
8 just read?
9 A Yes.
10 Q Could you read the second paragraph of this lease
11 renewal?
12 A All conditions shall remain the same, except the
13 monthly ren t starting September 1, 1989, shall be $156 per
14 month.
15 Q Can you identify the signature on this lease?
16 A The signature is Howard C. Gale, President, my
17 father.
18 Q With all conditions shall remain the same as you
19 just read, there is no indication that they are changing the
20 name of the corporate entity in this lease renewal act?
21 A That is correct.
22 THE COURT: Are we looking at Petitioner's Exhibit
23 6 still?
24 MR. KEISLINC: Yes, tl-iis is all part of Exhibit 6,
25 the lease a nd renewals that were submitted for this property.
26
• •
1 We are happy to give the Court a brief respite for
2 recess for just a moment, sir. We are going to mark these
3 Petitioner's Exhibit 7.
4 (Petitioner's Exhibit No. 7 marked for
5 identification.)
6 BY MR. KEISLING:
7 Q Mr. Gale, do you recognize the documents, and it is
8 actually a series of documents that are marked as Petitioner's
9 Exhibit 7?
10 A I do.
11 Q What are those documents?
12 A This is a Certificate of Registration from East
13 Pennsboro Township for the apartments.
14 Q Cai7 you tell me the date that is listed on each
15 certificate?
16 A Each certificate is March 27, 1981.
17 Q 1981 was, again, while you were still employed for
18 your father?
19 A That is correct.
20 Q The Certificate of Registrations, are you familiar
21 with why they were required by the township?
22 A Because the apartments were non-conforming use. We
23 were in a residential area, and from 1956 in East Pennsboro
24 Township my father would build apartments every so often.
25 I guess when the township looked at it, they saw
27
• •
1 that these were non-conforming use of a residential area so
2 that they passed an ordinance and with that they give the
3 Certificate of Registration showing that they knew these were
4 non-conforming uses.
5 Q The non-conforming aspect was essentially that
6 these were leased properties and not sold --
7 A Sold solely --
8 THE COURT: There were two people talking at once.
9 Start that question again.
10 BY MR. KEISLING:
11 Q So the non-conforming aspect of these properties
12 were that they were leased to others and not owned by the
13 people who resided in them?
14 A That is correct.
15 Q Each of the certificates have the same business
16 name on them. Can you read the name of the business?
17 A The name of the business was Country Club Park
18 Development.
19 Q It doesn't say Company, Inc., is that correct?
20 A That is correct.
21 Q But you testified regarding the merger in 1981,
22 Country Club Park, Inc., had been essentially out of existence
23 for some period of years?
24 A That is correct.
25 MR. SEIFERTH: I am going to object, Your Honor.
28
• •
1 That is just incredibly leading. If there is a question, I
2 think it should be an open-ended question and then let Mr. Gale
3 answer it.
4 THE COURT: The objection is sustained. Do you
5 want to ask the question in a different way?
6 MR. KEISLING: Certainly, Your Honor, thank you.
7 BY MR. KEISLING:
8 Q Mr. Gale, in 1981 was Country Club Park, Inc.,
9 still in exi stence?
10 A It was not.
11 Q Was Country Club Park Development, Inc., still in
12 existence?
13 A That was in existence from 1956 on.
14 Q Including through today'?
15 A Absolutely.
16 Q On the first page of these exhibits, Mr. Gale, can
17 you read the address that the property is listed on, the
18 certificate?
19 A We have 49 Circle Drive, Camp Hill.
20 Q The second one?
21 A 55 Circle Drive, Camp Hill; 22 Country Club Place,
22 Camp Hill; 7 Fargreen Drive; 6 Fargreen Drive.
23 Q Sir, these properties, if you refer to the list in
24 front of you , some of these properties are on what we have
25 called dispu ted properties --
29
• •
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
lE
17
18
,9
20
21
22
2.3
24
25
A Yes.
Q -- and at least one is on the undisputed
properties?
A That is correct.
Q But is there anything that these properties have in
common while they all have the non-conforming use?
A Well, the ones that are listed here were in East
Pennsboro Township so that they took it to mean non-conforming
because it was a residential area.
Some of these other properties are in Hampden
Township, so they did not apply to the non-conforming use of
East Pennsboro.
Q 7 Fargreen Road, we have a certificate for it.
That is on the list of undisputed properties, is that correct?
A That is correct.
Q Is 7 Fargreen Road at least at the time during
1981, that was, however, a leased property?
A That is correct.
Q So it is not part of the dispute today but it was a
leased property?
A It was a leased property, yes.
MR. KEISLING: Your Honor, we have, if it may
please the Court, 24 additional leases that were provided by
the Respondent as a result of discovery requests. I understand
opposing counsel will stipulate to their authenticity, we are
30
• •
1 willing to mark them up and they are ready to be initialed by
2 the court stenographer. We don't feel we need to impose on the
3 Court to go through 24 separate leases. So if it please the
4 Court, we would like to have them initialed and prepared for
5 entry into evidence.
6 THE COURT: Any objection to that?
7 MR. SEIFERTH: Well, I would like to at least lock
8 to see what -- the concern we have with going ahead and having
9 them marked, I agree they are authentic, but I would like to
10 see exactly what is going to be contained in that.
11 MR. KEISLING: Those are your copies. The posted
12 notes, I apologize for the posted notes, but they conform to
13 how we will have them numbered.
14 THE WITNESS: Okay.
15 THE COURT: Do you want to have them marked as one
16 exhibit or individual exhibits?
17 MR. KEISLING: One exhibit is fine with us if that
18 is fine with the Court, sir.
19 THE COURT: Again, I can't tell you how to present
20 the case. It seems it migl-it be easier to mark them all as one.
21 MR. KEISLING: It would be easier to mark them all
22 as one, sir.
23 THE COURT: Do you want them marked as Petitioner's
24 Exhibit 8?
25 MR. KEISLING: Fine, as long as the record reflects
31
• •
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
2Q
21
22
23
24
25
that there are 24 separate leases that go in.
THE COURT: We will take a moment and have the
stenographer mark that.
MR. KEISLING: I will verify my counting is
correct. There are actually 25 separate documents.
If I may approach the stenographer, does it matter
that we put stickers on each of the individual documents, can
we overlook that? I defer to the Court. We wanted to save the
Court's time so we marked them.
TH.E COURT: Why don't you mark them individually
and we will take a short recess and let you do that.
MR. KEISLING: Thank you, Your Honor, I apologize.
THE COURT: That is all right, we will take a brief
recess.
(Recess.)
(Petitioner's Exhibit Nos. 8 through 32 marked for
identification.)
THE COURT: Go ahead.
MR. KEISLING: Thank you, Your Honor. We have a
series of leases that were provided by the estate that are
marked Petitioner's Exhibit 8 through 32 inclusive, there are
25 leases.
BY MR. KEISLING:
Q Mr. Gale, just take a brief moment and flip through
the leases. What I would like you to do is make note as you
32
• •
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
flip through them, you don't have to say anything, of who the
landlord is. Look at the top and I will ask you a couple of
questions about the landlord when you have had a chance to
review each of the documents.
MR. SEIFERTH: Your Honor, I can stipulate that the
landlord listed on that is Country Club Park Development Co.,
Inc.
THE COURT: All right.
MR. KEISLING: Mr. Seiferth, are you willing to
stipulate that some of the leases are signed by Howard C. Gale,
Sr., as president, and some are signed by Julie Gale as
president, or would you want us to identify those signed by
Mrs. Gale?
MR. SEIFERTH: Again, I think the judge is capable
of seeing what is signed by whom in the exhibit.
MR. KEISLING: This isn't a question of your
capabilities, it is matter of having on the record that
Mrs. Gale as president of Country Club Development Company,
Inc., executed leases in that role. It has nothing to do with
your ability to see it but your ability to find it in the
record.
THE COURT: Are you able to stipulate to that?
MR. SEIFERTH: I can stipulate that tree signatures
that indicate Mrs. Julie Gale are, in fact, Julie Gale, the
Respondent. How it may be signed or how it may be entitled or
33
• •
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
the various extensions, it says what it says.
I have no objection to the fact that those are
authentic copies of all these leases in either Howard Gale,
Sr., or the Respondent, signed as indicated in that exhibit.
THE COURT: Is that sufficient?
MR. KEISLING: Yes. We are not going to ask
Mrs. Gale to stand -- we will just pick one that she has signed
and ask her to verify that, sir. So that will be fine.
BY MR. KEISLING:
Q Mr. Gale, keep this narrow, could you just look at
the very first lease that is labeled Exhibit 8 that is on the
top of your pile?
A Yes.
Q Can you tell me the date of that lease?
A The 1st day of October 1987.
Q Flip now to the very last exhibit marked
Petitioner's Exhibit No. 32. I am sorry, the very last
exhibit.
A Yes.
Q Cary you tell me the date on that lease?
A April 15, 2006.
Q As you flip through the 25 exhibits, did all of the
leases fall somewhere within those two dates that you just
read, sir?
A That is correct.
34
• •
1 Q I will approach and take the leases from you and
2 then I will ask a few very short questions.
3 Mr. Gale, did your father ever discuss with you how
4 he planned to leave the apartments, the leased premises?
5 A He did, yes.
6 Q How did he express his intentions to leave the
7 leased apartments?
g MR. SEIFERTH: I object to the question, the wil_1
9 speaks for itself; and that is extrinsic evidence of wriat the
10 testator's intent is as indicated in the Petitioner's first
11 exhibit.
12 MR. KEISLING: Your Honor, the response tc that is
13 clearly about extrinsic evidence, and we are willing to discuss
14 that. But once extrinsic evidence shows what the testator's
15 intents is to, all conversations such as this are allowed as an
16 exception to the Dead Man's Act.
1~ If the Court would like, I can take a moment to
18 find the exact cite, but this is permitted once there is other
"19 evidence, and we certainly contend that all the exhibits
20 constitute other evidence.
21 MR. SEIFERTH: I would disagree with that, judge,
22 on a couple reasons. First of all, the will is unambiguous in
23 the Respondent's position. Second cf all, the testator's
24 intent is to be derived from the words in the will.
25 Third of all, Your Hor.or, I think even if you need
35
• •
1 to look at or beyond the four corners of that will, I think
2 that the relevant time period is the time period when the
3 testator executed that will.
q What may have been done 30 years before that, and
5 certainly the decade worth of lease agreements after Mr. Gale,
6 Sr., had passed away, is frankly irrelevant. It boils down to
7 the will is clear and the only thing that all of these lease
8 agreements show is that Country Club Park Development Company,
9 Inc., was a landlord.
10 MR. KEISLING: Your Honor, I invited opposing
11 counsel to raise this issue before we went through everything.
12 We are more than prepared to discuss that. What this shows --
13 and opposing counsel is correct that the particular relevance
14 is what was intended at the time of Mr. Gail's -- when he made
15 his will.
16 His will was dated January 2, 1998, and he passed
17 some approximately three weeks later. What we have from the
18 earliest of the leases, 1964, straight through until 2606,
19 eight years after his passing, these properties were treated as
20 if they were the property of Country Club Development Company,
21 Inc. -- Country Club Park, thank you, Country Club Park
22 Development Company, Inc.
23 Clearly, Mr. Gale, as the owner of closely-held
24 corporations where he was if not the one hundred percent
25 shareholder, all but, maybe a percentage or two was elsewhere,
36
• •
1 but as the person who had complete dominion and control over
2 these closely-held corporations, Mr. Gale, always treated these
3 properties, all of these properties, as his own, regardless of
4 where legal title was held.
5 We also disagree that there is not are ambiguity in
6 the will. What Mr. Gale -- and the ambiguity arises as a
7 result of the way he treated these properties for 35 years.
g What Mr. Gale said in his will was I leave my
9 entire interest in Country Club Park Development Company, Inc.,
10 in trust. Mrs. Gale will get the benefit of the trust, and it
11 will eventually pass on to all the grandchildren.
12 There is a Supreme Court case, and I have got a
13 copy of the case, I have also prepared a memorandum of law, if
14 Your Honor would like it at some point, In Re: Estate of
15 Greenfield. Albert Greenfield was a Philadelphia businessman
16 and philanthropist. He owned a vast art collection.
17 In his will it said my art collection, my
18 paintings, my etchings, my drawings, go to my wife and then
19 pass to the Philadelphia Museum of Art on her passing.
20 It turned out after his death that many of the
21 paintings, the lion's share as a matter of fact, were actually
22 held in title by a company called Elizabeth Realty Company.
23 But he was the sole owner of Elizabeth Realty Company.
24 The Pennsylvania Supreme Court in 1973 said in that
25 instance where the decedent treated these as if they were his
37
• •
1 own, it was not necessary to be concerned with where legal
2 title resided.
3 We have a very identical case here. Mr. Gale
4 treated all of the properties, regardless of the entities, as
5 his own. We have testimony from his son whc worked for him for_
6 some 25 years that Mr. Gale treated everything as hi.s own.
~ We can even elicit additional testimony, but,
8 frankly, we don't think it is necessary, that will show
9 Mr. Gale's control of his own businesses and his own properties
10 that led to his son branching off on his own.
11 At the time Mr. Gale wrote his will and executed
12 his will, for 35 years he had been treating these properties as
13 if they were his legal property. They were in the sense that
14 he was the sole shareholder of Country Club Park Development
15 Company, Inc. So the cases that we have make it clear that we
16 can look to the extrinsic evidence.
1~ THE COURT: What does the Greenfield case say about
18 extrinsic evidence?
19 MR. KEISLING: What it says, sir, is that -- there
2d are two cases -- Greenfield itself says that it is certainly
21 admissible to determine, and I want to get this right. The
22 Court said, I am quoting now for Greenfield, in ascertaining
23 the meaning o.f the words used by the testator, the courts may,
24 if necessary, look beyond the language of the will itself to
25 the circumstances surrounding him at the time of its execution.
38
• •
1 We have all the leases. We also have, and we
2 haven't gotten there yet, and we expect to bring it up with
3 Mrs. Gale, we have corporate tax returns for Country Club
4 Development Company, Inc., from 1994 through 2006 that clearly
5 show these properties are treated for tax purposes as part of
6 the Country Club Development Company, Inc.
~ We have Pennsylvania tax returns that say the same
8 thing, although we don't have the full packet of tax returns
9 for the estate tax returns, we believe they coordinate, and the
10 Court will be able to do that.
11 We also have tax assessment forms from Cumberland
12 County from 1980, that again, we are going to raise with
13 Mrs. Gale on the stand, that list the properties as owned by
14 Country Club Development Company, Inc.
15 THE COURT: Is that not the case, they were not, in
16 fact, owned by that corporation?
1~ MR. KEISLiNG: What Mr. Seiferth is prepared to
18 bring up is at some point they were deeded to apparently
19 Country Club Park, Inc., which was merged into Howard C. Gaffe
20 Development. So from the inception they weren't owned by that
21 company, however, they were always treated as such.
22 Indeed, we have Mrs. Gale's last will and
23 testament. Keep in mind she has several roles here. She is
24 the executor of the estate of Mr. Gale. She is alsc the
25 president of Country Club Development Company, Inc.; and we are
39
• •
1 planning to introduce with her on the stand her last will and
2 testament dated in 2002 that specifically says I leave to my
3 children the properties, and she lists properties that are
4 owned by Howard C. Gale Development.
5 In her will it says: The real estate in Country
6 Club Park, Howard C. Gale Development Company, Inc., that is
7 held in trust for other grandchildren of Howard C. Gale, Sr.,
8 is not included in this item and is specifically noted as
9 follows: 520 Colony Road, 530 Fairway Drive, 49 Circle Drive,
10 55 Circle Drive, 6 Fargreen Road, 7 Fargreen Road, and 22
11 Country Club Park West.
12 There is no question, and I certainly don't want to
13 make the argument for opposing counsel, who is more than
14 capable of doing that himself, at some point a colleague in
15 this procedure of Mr. Radcliff, who was involved earlier in the
16 case, did a deed search and found way, way back these
17 properties were deeded to a different entity.
lg But that doesn't change the fact, and Greenfield is
19 directly on point, that doesn't change the fact that these
20 properties were always treated as if they were part of the
21 Country Club Park Development Company, Inc.
22 Mr. Gale, Sr., treated them that way, Mrs. Gale
23 treated them that way in her role as president of Country Club
24 Park Development Company, Inc., and she treated them that way
25 in her personal affairs as her own last will and testament in
40
• •
1 the case.
2 THE COURT: Do any of your cases say that a
3 decedent's statement of intention about his will is admissible?
4 MR. KEISLING: There is a cite, sir, where the
5 lower court said that we couldn't bring in the statement of
6 intention just on its own. But when coupled with extrinsic
7 evidence, and that is what this is, then that statement is
8 admissible and considered that. If I could have a moment I can
9 find the quote, I am sure I have it here.
10 THE COURT: What is the cite?
11 MR. KEISLING: I don't want to waste the Court's
12 time. It is not jumping out at me in terms of what was said.
13 Having said that, if you take our argument, there
14 is one other case that I would cite, In Re: Estate of
15 Schultheis, if I can.
16 THE COURT: If you could spell that and what it
17 says.
lg MR. KEISLING: S-c-h-u-l-t-h-e-i-s, if I can, the
19 cite is 747 A. Second 918, that is a Pennsylvania Superior case
20 from 2000.
21 THE COURT: That says what?
22 MR. KEISLING: What Schultheis says, Your Honor --
23 what the Superior Court found in Schultheis was that, and I am
24 quoting again, the Schultheis will does, however, contain a
25 latent ambiguity when extrinsic evidence is taken into account.
41
• •
1 The importance of that, and what that case shows is
2 that the latent ambiguity did not become clear until they
3 looked at all of the extrinsic evidence.
4 This is a relatively recent case from the Superior
5 Court, so our position is that we believe an ambiguity exists
6 by Mr. Gale's wording of my entire interest, quote, unquote, in
7 Country Club Park Development Company, Inc.
g However, the Court is allowed to look at the
9 extrinsic evidence to make a determination of what he meant by
10 my entire interest. Particularly, as we relate back to
11 Greenfield, and if I may, just so that the record has it, the
12 citation in the Greenfield estate case is 321 A. 2nd 922, and
13 that is a Pennsylvania Supreme Court case from 1973.
14 THE COURT: Did Mr. Gale's will dispose of his
15 interest in the other corporation that apparently was the legal
16 owner of these properties?
17 MR. KEISLING: Yes, that property went to Ms. Gale.
18 So ultimately - -- and this is why we think it is important, by
19 the way, that w e look at some of this evidence that we hav en't
20 gotten to yet, that Mrs. Gale hopefully. by her testimony, but
21 certainly by th e documents she executed as president and,
22 again, personally, treated this property as if these disputed
23 properties were meant for the grandchildren.
24 So regardless of what happened 30 some years ago
25 with the deeds and 40 years ago in some cases, Mr. Gale owned
42
• •
1 the property. We contend under Greenfield, it didn't matter
2 under what ma nner he owned the property, he own ed the property.
3 He treated th em consistently throughout the 35 years going back
4 to 1964, to 8 years after his death as if they were owned by
5 the company, that didn't vary; and it wasn't u ntil somebody
6 gratuitously for the Respondent's side checked the courthouse.
~ But we have a tax return we haven't gotten back
8 yet. The estate tax return filed in 2000 lists the properties
9 as being part of the Country Club Park Development, Inc.
10 So what the other side can show, they can show the
11 deeds, and we certainly admit, I would be happy if the deeds
I2 were on my side, but other than the deeds themselves, they
13 can't, to my knowledge, show anything.
14 They certainly didn't supply anything for us in
15 response to our subpoena. They can't show anything that shows
16 these properties were treated as under the ownership of any
17 entity other than Country Club Park. There is nothing that
18 says they were treated -- they were owned by Mr. Gale
19 individually or Howard C. Gale. And then we come back to
2C Mr. Gale's intent, and the intent is these properties, the
21 leased properties, gc to the grandchildren.
22 THE COURT: The grandchildren are who in relation
23 to this witness?
24 MR. KEISi,ING: There are five, if I am not
25 mistaken, there are five grandchildren; four, if you will,
43
• •
1 natural grandchildren that are the children of Mr. Gale, Jr.,
2 Howard C. Gale, Jr., and I would ask Mr. Gale to give you their
3 names.
4 THE WITNESS: Their names are Ellen Gale; Melissa
5 Gale; M. Jeffrey Gale; and Howard Greg Gale, III.
6 MR. KEISLING: Then there is an additional
7 grandchild, who is identified in the will as a step-grandchild,
8 who is Anthony Rossignoli. Forgive me if I didn't pronounce
9 that correctly. He is, if I believe and I understand
10 correctly, the son of Mrs. Gale's daughter, but is not related
11 by blood to Mr. Gale, Sr. But the will specifically says
12 provided for his grandchildren and step-grandchild.
13 The other interesting thing, it really does come
14 down, Your Honor, our suggestion is, to where the properties
15 ultimately go.
16 Howard C. Gale Development, at least according to
17 the will, and we have no information whether it is still in
18 effect or not, but Mrs. Gale leaves ultimately these
19 properties, according to the document that we want to
20 introduce, to Mr. Rossignoli.
21 So really, the ultimate question comes down to
22 these properties that we think all the evidence shows would go
23 to all of the grandchildren, which was Mr. Gale's intent. If
24 the Respondent succeeds, they will go to the step-grandchild,
25 and Mr. Gale's grandchildren are excluded from those
44
• •
1 properties.
2 That defies even common sense. We don't get to
3 common sense. We have all the evidence, but we think that it
4 couldn't have been Mr. Gale's intent, and we think you can find
5 that, Your Honor, that his step-grandchild would be favored
E above any of the other grandchildren; we certainly won°t
7 suggest that he favored less.
g THE COiJRT: Who am I to say what the testator
9 wanted to do on that point unless you have some evidence on it?
10 Mr. Seiferth, did you have a response?
11 MR. SEIFERTH: I do have a response. It was a
12 rather long argument. I will try to be brief.
13 The lease agreements to me, I don't know that they
14 have any probative value of Mr. Gale's intent other than that
15 he listed the lardiord or the landlord entity, Country Club
16 Park Development Company, Inc.
l~ It seems to me there is some confusion here between
18 what a landlord is and what a true owner is. More
19 specifically, what the actual assets are of one corporation
20 versus the other, the two that we are disputing here.
21 I don't think there is any dispute per the deed,
22 which is presumptive evidence of ownership, indicates that
23 these five disputed properties are assets of what is currently
24 the Howard Gale Development Company, Inc. In short, I fail to
25 see the probative value of any of these lease agreements.
45
• •
1 Secondly, anything after Mr. Gale's death to me is
2 irrelevant as to his intent.
3 THE COURT: The issue for the moment for me is
4 whether this witness will be permitted to say what his father
5 told him about his intent. That was the question.
6 MR. SEIFERTH: Right, that is correct, Your Honor,
7 and I think the only way that you get to that is if there is a
8 ruling from you as to whether or not that will is ambiguus.
g THE COURT: Does the Dead Man's Act not play a part
10 of it?
11 MR. SEIFERTH: Frankly, Your Honor, that is an
12 interesting question. My understanding of the Dead Man's Act
13 is it involves more of a transaction or occurrence and that the
14 person who is testifying about what the decedent said has an
15 adverse interest.
16 Maybe that needs to be explored more as to whether
17 or not Mr. Gale, Jr., is adverse to Mr. Gale, Sr., in terms of
18 the circumstances, as we sit here today, in terms of whatever
19 it is senior had said. What. I am saying in short is, I frankly
20 find it -- I am uncertain as to whether we have an adverse
21 element between the decedent and Mr. Gale, Jr.
22 THE COURT: I would assume that would come up quite
23 a lot in these cases where a parent would be testifying to
24 something that would benefit a child. Are there no cases on
25 that?
46
• •
1 MR. SEIFERTH: There are, Your Honor, I don't have
2 a cite for you as I stand here right now. All I can say,
3 potentially the Dead Man's Act applies. It certainly is a
4 hearsay statement. Frankly, based on the un-ambiguity of the
5 will, there is no reason to bring in what the testator may have
6 said to his son. That is our position.
7 THE COURT: All right. Why don't you make an offer
8 of proof, Mr. Keisling, and then I will rule on the objection.
9 In other words, what is this witness going to say his father
10 told him.
11 MR. KEISLING: Your Honor, by way of offer of
12 proof, Mr. Gale would testify that on several occasions over a
13 period of years Mr. Gale, Sr., expressed the intent that the
14 leased properties which are comprised of the disputed
15 properties and undisputed properties on the list that we have
16 referenced throughout this hearing, that those properties would
17 pass to Mr. Gale's grandchildren.
lg THE COURT: The objection is sustained.
19 MR. KEISLING: Your Honor, thank you.
20 THE COURT: I don't think we are going to be able
21 to finish today, so that if counsel come up with some further
22 research on the point, I will certainly reconsider that ruling.
23 As of now, the objection is sustained.
24 MR. KEISLING: Thank you for giving me the
25 opportunity. Your Honor, there is a case, I am embarrassed
47
• •
1 that I can 't put my finger on .it, but I read it late last
2 night, So that I am sure that it is here.
3 In terms of timing, I think ultimately, we have tax
4 returns, we have questions for Mrs. Gale, it is quite possible
5 Mr. Seiferth is planning to cross-examine Mr. Gale, he
6 certainly made reference to that. I am wondering in terms of
7 timing how far you would like to go today.
g We are at a natural breaking point, not that we are
9 done, but in the sense that each of the evidence that we have
10 now is after Mr. Gale left the employ of his father. So we
11 would like to have Mrs. Gale testify to that as well as some of
12 the leases.
13 So we are not done with our case but we are at a
14 natural braking point, depending on what Your Honor's
15 preference is.
16 THE COURT: I think we should continue as long as
17 we can. But the schedule is such that we probably won't get
18 back to the case until June. So I would continue on for the
19 rest of the afternoon and see where we are at that point.
20 MR. KEISLING: We are finished with the direct
21 examination of Mr. Gale, however, we would reserve the right to
22 call him back if we may if need be.
23 THE COURT: All right.
24 MR. KEISLING: Thank you, Your Honor.
25 MR. SEIFERTH: Just a few brief questions on
48
• •
1 cross-examination.
2 THE COJRT: Certainly.
3
4 CROSS-EXAMINATION
5 BY MR. SEIFERTH:
6 Q Mr. Gale, my name is Adam Seiferth, and I represent
7 the Respondents. I just have a few questions for you. First
8 of all, according to your testimony, you had stopped actually
9 working for your father in whatever corporation as of 1990?
10 A Directly working with him, yes.
11 Q Were you involved in any of the bookkeeping for
12 your father?
13 A I was, yes.
14 Q Were you aware while you were working for your
15 father as an employee that the five properties that we are
i6 disputing here today were, in fact, deeded to Country Club
l7 Park, Inc., now Howard Gale Development Company?
18 A They were always treated that Country Club Park
19 Development Company owned them, and that is where all the
20 rental income went into.
21 Q I understand that. Were you aware that they were
22 deeded in Country Club Park, Inc.?
23 A I was not, and my father wasn't. Because back --
24 when he set the corporation up back in 1956 --
25 Q Hold on a second. I am just asking about you, you
49
• •
1 were not aware that they were deeded in Country Club Park,
2 Inc., when you were employed for your father?
3 A I thought they were deeded in Country Club Park
4 Development Company.
5 Q So you thought but you didn't know, you never
6 actually looked at the deed, is that a fair statement?
7 A Neither did my father.
g Q Is it possible, Mr. Gale, that some properties are
9 clearly properties that are owned or assets of Howard Gale
10 Development Company could have been leased with Country Club
11 Development Company listed as the landlord?
12 A I don't recall.
13 MR. SEIFERTH: Permission to approach, Your Honor.
14 THE COURT: Certainly.
15 MR. KEISLING: Your Honor, we are going to object
16 to the extent that we had subpoenaed all of the relevant leases
17 and we have entered those in. We are not familiar -- I don't
18 know that we were submitted this document before, so to the
19 extent that --
20 THE COURT: You made a request for production of
21 documents that would cover this item that would preclude the
22 other side?
23 MR. KEISLING: There was a subpoena submitted, sir,
24 that included all leases of all of the various corporations.
2~ MR. SEIFERTH: I don't know that the subpoena was
50
• •
1 that broad, Your Honor, and not actually un-objected to.
2 MR. KEISLING: Your Honor, they complied with the
3 subpoena. That would be very disingenuous to say, and we have
4 correspondence from Mr. Radcliff, here is responses to the
5 subpoena, and now to suggest that they just didn't, you know.
6 MR. SEIFERTH: We did respond to the subpoena. I
7 don't have it in front of me, judge.
g MR. KEISLING: One moment, I do have this, Your
9 Honor, if I could put my finger on it.
10 THE COURT: Whose subpoena are we talking about?
11 MR. SEIFERTH: The Petitioner's subpoena served on
12 the Respondent.
13 THE COURT: The return date for the subpoena was
14 when?
15 MR. KEISLING: I want to say the summer of 2007. I
16 apologize to the Court, it actually specifically asks for
17 lessees of Country Club Park Development Company, and I
18 apologize to Mr. Seiferth.
19 THE COURT: All right, go ahead, Mr. Seiferth.
20 (Respondent's Exhibit No. 1 marked for
21 identification.)
22 BY MR. SEIFERTH:
23 Q Mr. Gale, I am going to show you what we have
24 marked as Respondent's Exhibit No. 1. I just ask that you take
25 a few moments to look at that please. Did you have the
~1
J
• •
1 opportunity to look at that, sir?
2 A Yes.
3 Q Do you recognize this document?
4 A I do not recognize the document.
5 Q Do you recognize the signature on the last page
6 where it s ays landlord?
7 A I do.
g MR. KEISLING: Your Honor, I am going to object,
9 simply we made it clear Mr. Gale didn't work for his father
10 after 1990 , and this lease indicates 1997. Mr. Gale is not
11 competent to discuss this document.
i2 MR. SEIFERTH: I can ask him if he recognizes the
13 signature.
14 THE COURT: You may do that.
15 BY MR. SEIFERTH:
16 Q Do you recognize that signature?
17 A I do.
lg Q Whose signature is that?
lg A That is my father's.
20 Q Do you recognize the property address, the premises
21 that is i ndicated on this lease?
22 A I do.
23 Q Could you just tell us what the address is?
24 A It says 530 Fairway Drive, Camp Hill, PA.
25 Q Is that one of the disputed properties, sir?
52
• •
1 A It is.
2 Q Who was listed as the landlord?
3 A In this case it was Gale Development Company.
4 MR. SEIFERTH: Your Honor, I would like to offer
5 this as our first exhibit, Respondent's first exhibit.
6 THE COURT: Are you moving for its admission?
'7 MR. SEIFERTH: Yes, and I would move for its
8 admission.
g THE COURT: All right. Respondent's Exhibit 1 is
10 admitted.
11 BY MR. SEIFERTH:
12 Q Mr. Gale, you indicated that your father did not
13 maintain a strong corporate division between the various
14 entities that he controlled, is that correct?
15 A That is correct.
16 Q Could you just tell me what you meant by that?
1~ A He was the president, a very controlling person of
18 everything. So consequently, whether it was building or the
19 apartments, he considered himself as the head of them all.
20 Q In other words, it didn't matter if something was
21 Howard Gale Development Company versus Country Club Park
22 Development Company, he was the king pin so to speak?
23 A He knew exactly what company was what company.
24 When it came to rentals, he put everything in the Country Club
25 Park Development Company.
53
• •
1 Q So he knew exactly what company was what company,
2 just like in the will he noted Howard Gale Development
3 Company's assets were to go tc his wife and Country Club Park
4 Development Company was to be put into trust ultimately to your
5 grandchildren, correct?
6 A Knowing that the apartments were part of Country
7 Club Park Development Company, Incorporated.
g Q So your father, are you saying that there was an
9 arbitrary distinction between apartments and --
10 MR. KEISLING: Objection, he is characterizing what
11 Mr. Gale said, and that is not what he said.
12 THE COURT: You may bring that out on redirect.
13 BY MR. SEIFERTH:
14 Q Are you saying there was a distinction, sir,
15 between rental units versus homes that are bought and sold to
16 individuals?
17 A Yes.
lg Q Was that arbitrary division made regardless of any
19 of the paperwork that may or may not exist with regard to all
20 of these corporate entities?
21 A Repeat that.
22 Q I said, is that the case, is that your
23 understanding of the division between the two corporations
24 regardless of any paperwork?
25 A The paperwork for the apartments was Country Club
J n
• •
1 Park Development Company. For the building that we did, it was
2 Gale Development Company.
3 MR. SEIFERTH: That is all I have.
q THE COURT: Ckay.
5 MR. KEISLING: No further questions, Your Honor,
6 thank you.
7 THE COURT: All right, you may step down, thank
8 you.
g MR. KEISLING: Your Honor, we would like to move
10 for the admission of all the exhibits we have referenced, that
11 would be Petitioner's Exhibits 1 through 32.
12 MR. SEIFERTH: Your Honor, I will try and do this
13 succinctly. I would lodge an objection to any lease agreement
14 that was entered into or began, the term began, after Mr. Gale,
15 Sr.'s, death as irrelevant.
16 Unfortunately, I don't have the exact numbers of
17 each of those 40, but it is a simple issue of the date.
18 The second issue as to the relevancy is I would
1.9 object because listing Country Ciub Park Development Company,
2G Inc., as a landlord, I fail to see how that is relevant in
21 proving intent, the issue here, that is what assets belong
22 where. Those are my only two objections.
23 THE COURT: All right. Mr. Keisling, how are the
24 leases after the date of Mr. Gale's death relevant?
25 MR. KEISLING: Well, Your Honor, I suppose we would
5~
1 have to say to some extent that if the Court is looking at
2 intent, and it is the intent at the time that the will is
3 created or signed, which is January 2, 1998, I certainly would
4 understand the argument that they are not relevant; however,
5 what we are looking for, again, with the cases that I said
6 earlier, and I will spare the Court recitation again, is the
7 40-year pattern of how these properties were treated.
g Where it comes in, and we think is relevant, is
9 that the estate treated the properties presumably as they
10 understood Mr. Gale's intent as well.
11 So we think it is relevant because the estate is
12 the one who handled these properties, Mrs. Gale is the executor
13 I believe, or was the executor of the estate; furthermore, as
14 president of Country Club Development Company, Inc., presumably
15 acted as she thought conformed with the intent of Mr. Gale.
16 So it is the understanding that is extrinsic
17 evidence to show their understanding of Mr. Gale's intent, and
18 I think they are relevant for that purpose, sir, thank you.
19 THE COURT: You feel somewhat of an admission
20 against interest?
21 MR. KEISLING: Yes, sir, thank you.
22 THE COURT: All right, Petitioner's Exhibits 2
23 through 32 are admitted.
24 MR. KEISLING: Thank you, Your Honor.
25 THE COURT: You are welcome.
56
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1 MR. KEISLING: We would like to call Mrs. Gale to
2 the stand. Or perhaps I would offer her or the Court a brief
3 recess for personal interests if anybody is interested.
4 THE COURT: Sure.
5 MR. KEISLING: Five minutes if we may?
THE COURT: All right. Brief recess.
7 (Recess.)
g MR. KEISLING: Thank you, Your Honor. We would
9 like as our next witness to call Julie F. Gale to the stand.
10 THE COURT: All right, are you calling her as of
11 cross?
12 MR. KEISLING: Yes, Your Honor.
13
14 JULIE F. GALE,
15 called as on cross-examination,
16 having been duly sworn, testified as follows:
17 DIRECT-EXAMINATION
18 BY MR. KEISLING:
19 Q Good afternoon, Mrs. Gale.
20 A Good afternoon.
21 Q My name is Bret Keisling, and I represent the
22 Petitioners in this matter.
23 A You are who now? I didn't get that.
24 Q My name is Bret Keisling.
25 A Keisling, okay.
57
1 Q Thank you. Could you state your name for the
2 record?
3 A Julie F. Gale.
4 Q Your address?
5 A It is 105 Fairway Drive in Camp Hill, Pennsylvania.
6 Q You are the widow of Howard Gale, Sr.?
7 A Yes.
g Q What year did you marry your husband?
g A I think it was '67.
10 Q So you were married to him through the 30 years
11 that --
12 A Oh, yes.
13 Q -- we have been discussing today?
14 A Yes.
15 Q Were you involved in the business at all during
16 this time?
17 A Speak louder, I have trouble hearing.
lg MR. KEISLING: Your Honor, may I approach closer to
19 Mrs. Gale?
2p THE COliRT: All right.
21 MR. KEISLING: Thank you, sir.
22 BY MR. KEISLING:
23 Q Were you involved in the business?
24 A No, I was not.
25 Q Not in any way --
58
• •
1 A Shape ar form.
2 Q During his lifetime?
3 A That's right.
4 Q But you came to be involved in this business after
5 his passing?
6 A I took care of the rentals really. It was passed
7 on to me by Bob Price, not to my liking, but I am doing it.
8 Q In the role as president of Country Club Park
9 Development Company, Inc.?
10 A Yes.
11 Q In that role as president you have executed
i2 numerous doc uments?
13 A Not to my knowledge.
14 Q Have you executed, signed any leases as president
15 of Country C lub --
16 A I signed leases, yes, to rent the apartments.
17 Q Have you signed tax returns for the estate?
18 A Sign what?
19 Q Tax returns for the estate?
20 A Tax returns? I don't know (unintelligible).
21 Q If you are not sure, that is fine.
22 A I am not sure .
23 Q Your role didn't start until after Mr. Gale's
24 passing?
25 A Exactly.
59
• •
1 Q Mrs. Gale, I would like, if I may approach, I would
2 like to show you the lease that your attorney entered into, it
3 is marked R- 1. If I can show that.
q A I don't have my glasses.
5 Q Are your glasses in the courtroom, ma'am?
6 A Yes, they are in my hand bag, in my glass case.
~ Q This came out when Howard, Jr., testified, but do
8 you see the name of the company at the top?
g A The company?
10 Q Yeah, what company is the landlord on the lease?
11 A The company, H. Gale Development Company, Inc.
12 Q What is the address that this lease is for?
13 A 105 Fairway Drive.
14 Q If I may, Mrs. Gale, if I may point to you. I
15 believe the address is this one there.
16 A Excuse me, 530 Fairway Drive, yes.
17 Q What is the name of the tenant on that lease?
lg A The tenant right now, let me see -- do you mean
19 right now?
20 Q No, I am sorry, on that lease?
21 A Oh, on this lease, the tenant on this lease. Where
22 do I find t hat?
23 MR. SEIFERTH: Your Honor, if I may. We have all
24 the leases in evidence, they speak for themselves, I think what
25 he is inten ding to do, he i.s going to say there is subsequent
60
• •
1 leases that Julie Gale signed that say Country Club Park, Inc.
2 We have all this documentary evidence. To me this seems to be
3 just an unnecessary exercise.
q MR. KEISLING: Respectfully, he is absolutely
5 correct. I am surprised he had noticed. It seems to me it is
6 very relevant. We have a lease signed in 1997 by Howard Gale.
7 It is the only exhibit so far that has been entered, the
8 opposing side said is Howard Gale Development Company, Inc.,
9 but the subsequent lease for the same tenant two years later
10 has been changed to Country Club Development Company, Inc.,
11 signed by Mrs. Gale.
12 So I understand that opposing counsel would like me
13 to stipulate to everything, but we think it is relevant to have
14 Mrs. Gale explain that the entity did change, why it changed,
15 and she is the one who signed that lease.
16 THE COURT: You can ask the question.
17 BY MR. KEISLING:
lg Q Is Mr. Clouser the tenant on the lease? And I know
19 that is leading, but perhaps we can save time.
20 MR. SEIFERTH: You have her as on cross.
21 MR. KEISLING: Thank you, sir.
22 BY MR. KEISLING:
23 Q If I may point to you. Right up there, David A.
24 Clouser.
25 A For where?
n1
•
.~
1 Q For the tenant of this property?
2 A Gregory T. Clouser, no that is not. Clouser, no,
3 it isn't.
q Q Clouser is not the tenant of this property?
5 A Not now, no, sir. It is Heather and Michael
6 (unintelligible).
~ Q But in 1997, did Mr. Clouser rent this property?
g A Well, I couldn't tell you. I was never involved in
9 the business --
10 Q Okay. Let me show you one other lease, and I am
11 trying to be very brief. Can you read the name at the top of
12 this list?
13 A Country Club Park Development Company, Inc.
14 Q The tenant, according to this lease?
15 A David A. Clouser.
16 Q This lease date is?
17 A October 1, 1999.
lg Q Let me, Mrs. Gale, if I may, just flip to the last
19 page and under the landlord, do you recognize that signature?
2Q A Yes, that is mire.
21 Q That is your signature?
22 A Yes. It looks like it, I don't know, I am not
23 quite sure.
24 Q But you have no reason to think someone is
25 impersonating you on your own company leases?
62
• •
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
A Well, I don't know. I will tell you, there is a
question mark.
MR. KEISLING: We would ask the Court at its
convenience to compare the signature with that of the signed
verification and the signatures would match we will suggest.
THE COURT: I am not qualified to match signatures
I don't think.
MR. KEISLING: May I have a moment, Your Honor.
THE COURT: Are you saying that is not your
signature?
THE WITNESS: I don't know. It looks like it, but
I am not quite sure, Your Honor.
THE COURT: All right.
MR.. KEISLING: Your Honor, I believe opposing
counsel has stipulated that all the signatures were hers. If
you would like to step back from that, we can, otherwise, we
can stipulate. Or we are going to have to bring in an expert
to do the signatures, which doesn't seem productive.
I believe the stipulation was already made, Mr.
Seiferth.
MR. SEIFERTH: Yes, I made the stipulation, that is
why I don't understand why we keep asking things that we
stipulated to. 3ut the stipulation is the signatures are Julie
Gale's, they are Julie Gale's.
MR. KEISLING: Thank you, sir. Thank you, Your
63
• •
1 Honor.
2 BY MR. KEISLING:
3 Q Mrs. Gale, do you know why the landlord in 1997
4 would have been Howard C. Gale Development Company, Inc.?
5 A 1997?
6 Q Yes. Specifically, why was the landlord for this
7 property and this same tenant, Gale Development Company, in
8 1997, and then changed to Country Club Park Development in
9 1999?
10 A I don't know.
11 Q You don't have any idea?
12 A No.
13 Q You are not aware of any difference between the two
14 entities?
15 A Absolutely not, because I was never involved in the
16 business I told you.
17 Q I understand that.
18 MR. KEISLING: We will step, Your Honor, away from
19 the leases and move on.
20 THE COURT: All right.
21 MR. KEISLING: Anticipating perhaps an objection,
22 we have documents that, again, are post-death, post-passing,
23 however, we believe they qualify as statement against interest.
24 They also show the continuing -- all the objections we have
25 already di scussed., the previous evidence was admitted. So I am
64
• •
1 going to present some items and just wanted to forewarn the
2 Court. If I may have No. 33. If I may approach.
3 THE COURT: Certainly.
4 MR. KEISLING: These are all collectively
5 Petitioner' s Exhibit 33.
6 (Petitioner's Exhibit No. 33 marked for
7 identificat ion.)
8 BY MR. KEISLING:
g Q Mrs. Gale, these are documents which I will hand to
10 you which represent eight different properties. All of the
11 documents, as you will see, are the same form. Can you read to
12 me the top two lines on the back.
13 A Cumberland County Notice of Change of Assessment.
14 Q So this is a form from Cumberland County?
15 A Yes.
16 Q On the face of each document I will show you one.
17 Let me flip over to the other side. Can you read the top line
18 of the address, who they are addressed to?
19 A The Country Club Park Development.
20 Q Company is on the second line, is that correct?
21 A Company, yes.
22 Q Mrs. Gale, I am going to flip through each one of
23 these. Is the address the same, the addressee?
24 A Yes.
25 Q The same?
65
• •
1 A Yes.
2 Q Is that tre same?
3 A Yes.
q Q Is that the same?
5 A Yes.
6 Q Although the front is a little bit different, could
7 you read that line for me?
8 A Country Club Park Development, 105 Fairview Drive.
g Q It is also the same?
10 A Yes, it is the same.
11 Q Finally, also the same?
12 A Yes, same.
13 MR. KEISLING: If opposing counsel will stipulate,
14 these addresses all represent the disputed properties and their
15 change in tax assessments from Cumberland County that indicate
16 at least as far as the county is concerned these are sent to
17 Country Club Park Development. So we will stipulate as to that
18 is what they were, they are, I won't have her read through each
19 property address.
20 MR. SEIFERTH: I object to these documents on the
21 basis of hearsay. It says right on the top of it, this is not
22 a tax bill. I don't knew what these are. I can stipulate that
23 they are all the same. I can even stipulate to authenticity.
24 But I am objecting to their admission on the basis of hearsay.
25 THE COURT: All right. Have you moved for their
66
• •
1 admission yet?
2 MR. KEISLING: We haven't moved for their admission
3 yet, sir, however I will mcve for the admission.
4 MR. SEIFERTH: I stipulate that they are all the
5 same address on the envelopes.
6 MR. KEISLING: I would move for their admission at
7 this time, Your Honor.
8 MR. SEIFERTH: I would object on the basis of
9 hearsay.
10 THE COURT: All right. Petitioner's Exhibit 33 is
11 admitted.
12 MR. KEISLING: Thank you, Your Honor.
13 If I may, this would be Petitioner's Exhibit No.
14 34.
15 (Petitioner's Exhibit No. 34 marked for
16 identification.)
17 MR. KEISLING: This exhibit, Your Honor, is the
18 inheritance tax return. that was filed by Attorney Trace, which
19 is on the docket, was entered by the estate on the docket. If
20 I may approach the witness.
21 BY MR. KEISLING:
22 Q Mrs. Gale, as I said, this is, as you will see
23 here, the inheritance tax return that was signed by Mr. Trace.
24 A Yes.
25 Q On March 30, 2000.
67
• •
1 A Yes.
2 Q I am going to flip and about half way there, there
3 is what is called a Schedule C-1, Closely-Held Corporate Stock
4 Information is the form, if you can read that. Again, to be
5 helpful because that is hard for anyone to read, is this for
6 the Howard C. Gale Development Company?
7 A Yes.
8 Q You see that.
9 Flip one page, and the next page which is also a
10 Schedule C-l, Closely-Held Corporate Stock Information Report.
11 Is this for Country Club Park Development, Inc., is that what
12 this says on the second line?
13 A That is what it says, yes.
14 MR. SEIFERTH: Your Honor, again, we are just
15 reading into the record written documents. Furthermore,
16 Mrs. Gale is perfectly capable of reading, this is a document
17 prepared by Attorney Robert Trace, now deceased.
18 I understand this particular return is of the
19 docket, and because it is of the docket and we are continuing
20 this docket as we sit here today, I am not going to object to
21 it, but I don't see a reason to proceed again through this
22 exercise.
23 MR. KEISLING: Your Honor, it is all on the third
24 page I was going to show her. Part of the tax return, I
25 understand that it is on the docket. But, quite frankly, we do
68
• •
1 want it on the record, and on the record of testimony, is that
2 the properties are listed by entity on the very next page.
3 What I wanted M rs. Gale --
4 MR. SEIFERTH: They were listed by Robert Trace,
5 not Julie Gale.
6 THE COURT: Is this something Ms. Gale signed?
7 MR. KEISLING: Well, as the executor of the estate,
8 she certainly w ould have been responsible --
9 MR. SEIFERTH: Your Honor, she is not the executor
1C of the estate, Robert Trace is the executor.
11 THE COURT: Who is the executor?
12 MR. KEISLING: Well, in fairness, Your Honor, if I
13 am mistaken, I apologize, but I have said it four to five
14 times, and this is the first time I have been corrected.
15 MR. SEIFERTH: The executor of the estate was
16 Robert Trace?
17 THE WITNESS: That's right.
18 MR. SEIFERTH: Sorry I didn't correct that sooner.
19 It was already in the will that we have of record at this
20 point, but I ap ologize fcr that.
21 THE COURT: Who is the executor now or executrix?
22 MR. KEISLING: It was my understanding that
23 Mrs. Gale in po sition as Respondent, sir. Forgive my
24 frustration, bu t my understanding was that Mrs. Gale is the
25 Respondent, so she is here to speak for the estate.
69
• •
1 I think it is fair to show what we are going to
2 indicate, if I may just one moment, Your Honor, show that,
3 again, the tax return in 2000 clearly lists the apartments, the
4 leased properties, as part of Country Club Development Company,
5 Inc. A later estate, a modified amended return, which is also
6 on the document, has now moved the properties up.
7 Our argument, and I said to Mr. Seiferth on the
8 break, that I am hoping we don't continue until June, we would
9 all like to wrap this up today, but if we are going to have the
10 same argument on objection at each and every item, we certainly
11 intend to introduce all the corporate tax returns.
12 Mr. Seiferth was aware of this yesterday. We
13 discussed last week we were going to have the evidence. We are
14 having the same objections. We think it clearly shows how the
15 properties were treated from 1964 up until 2006, and she is
16 here to respond.
17 THE COURT: How would Ms. Gale be bound by that if
1.8 she was not the executrix?
19 MR. KEISLING: We think the estate itself would
20 have an estoppel issue that -- and we just want the record to
21 be very clear, and the record of testimony as well, to be very
22 clear that the properties have always been treated as if they
23 were in the -- titled to Country Club Development Company, Inc.
24 Again, I promise, Your Honor, I am not trying to
25 belabor the point that although the deeds say what they say,
70
• •
1 every other document, the 32 leases, opposing counsel raised
2 one lease in response to our 32.
3 We have 12 years of tax returns. I don't have any
4 more fun discussing 12. years of tax returns than the witness or
5 the judge does, but all of these from 1994 through 2006 all
6 show that the properties are treated the same way. So
7 Mrs. Gale was --
8 THE COURT: Who is the proper Respondent in this
9 case, is it the estate, is it Ms. Gale? I was assuming she was
i0 the executrix, that seemed to be the way it is set up, but
11 apparently that is riot the case.
12 MR. SEIFERTH: Currently.
13 THE COURT: Who is?
14 MR. SEIFERTH: Currently.
15 THE COURT: She currently is?
16 MR. SEIFERTH: Yes, she currently is.
17 THE COURT: I will permit the exhibit to be
18 introduced. Petitioner's Exhibit 34 is admitted.
19 BY MR_. KEISLING:
2G Q Mrs. Gale, this is the third page after the C-1
21 reports we just discussed. Do you see that there is a heading
22 of Country Club Park Development Company, Inc.?
23 A Yes.
2'4 Q Do you see properties that are listed 1 through 9?
25 A Yes.
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1 Q Those properties, and I can provide you a list if
2 you need it, but are those properties, to your knowledge, those
3 are the ones we have the dispute about, is that correct?
4 A The five, yes, the five of them.
5 Q And the other properties that we no longer disagree
6 on?
7 A Well, the seven (unintelligible).
8 THE COURT REPORTER: I am sorry, I didn't hear your
9 answer.
10 THE WITNESS: The five properties (unintelligible).
11 THE COURT: The stenographer can't hear you, and I
12 didn't either. I didn't hear what you said. Something about
13 five properties.
14 BY MR. KEISLING:
15 Q If you could just answer what you said about the
16 five properties. Are these part of the disputed properties
17 listed under Country Club Development Company, Inc.?
?8 A The five are, yes.
19 Q Above that is a heading of Howard C. Gale
20 Development Company, Inc.
21 A Yes.
22 Q Those properties are not listed under the property
23 of Howard C. Gale?
24 A I don't understand your question.
25 Q For the estate tax return in the year 2000, the
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1 properties were not listed as assets of Howard C. Gale
2 Development , they are not under that column, is that correct?
3 A I don't know.
4 Q Are they on that list or are they on the list
5 underneath Country Club Park Development?
6 A No, I don't think so. Sorry, I can't help you
7 there.
8 Q The document does say what it says, thank you.
9 MR. SEIFERTH: Sorry, Your Honor, I want to be able
10 to see what we are showing her.
11 THE COURT: Certainly.
12 MR. SEIFERTH: Okay, thank you.
13 BY MR. KEIS LING:
14 Q Mrs. Gale, one more question on this. This is
15 actually in response to a question his honor asked much
16 earlier. A ccording to the estate tax return for the estate of
17 Howard C. G ale it says common stock in the closely-held
18 corporation -- we are looking at the Country Club Park
19 Development Company, common stock -- it says 100 shares
20 Mr. Gale owned, is that what that says there?
21 A It says one hundred snares, yes.
22 Q It says one hundred shares, and these are the
23 shares outs tanding?
24 A Uh-huh.
25 Q Then under the number of shares owned by decedent
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1 that also says one hundred, right?
2 A Yes.
3 MR. KEISLING: Your Honor, we will do these in lump
4 as well, although, we will want to cover a couple. We would
5 like to present Petitioner's Exhibits 35 through 45 inclusive.
6 These are, by way of explanation, corporate tax returns for
7 Country Club Park Development Company, Inc., from 1994 through
8 2005, with the exception of 1999, which was not provided to us.
9 We would ask that these be marked.
10 (Petitioner's Exhibit Nos. 35 through 45 were
11 marked for identification.)
12 MR. KEISLING: Forgive me, Mrs. Gale, and, Your
13 Honor, if you will bear with me for just one moment.
14 THE COURT: Certainly.
15 MR. KEISLING: Thank you, sir.
16 BY MR. KEISLING:
17 Q Mrs. Gale, does Country Club Park Development
18 Company, Inc., either now while you are president or at any
19 point to your knowledge have any income or revenue other than
20 rental income?
21 A That is all I have is rental income.
22 Q So if Country Club Park Development Company, Inc.,
23 shows income tc your knowledge other than that, what you don't
24 know, that income would be rental income, is that correct?
25 A Would be what?
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1 Q Would be rental income from the rental of the
2 properties?
3 A Yes.
4 Q Again, we have tax returns, and we are not going to
5 cover over them, I just have a couple questions for you on a
6 couple of them. Your role as current president of Country Club
7 Park Development Company, Inc., is why I am asking you these
8 questions, even though these predated your having that role.
9 What I would show you, and this is Petitioner's
10 Exhibit No. 35, and this is a 1994 tax return, can you tell me
11 the entity?
12 A You mean the Country Club --
13 Q Yes.
14 A The Country Club Park Development Company, Inc.
15 Q Thank you, ma'am.
16 Under income, which is the top section, we have
17 line 6 that says gross rents?
i8 A Yes.
19 Q Then can you read that number?
20 MR. SEIFERTH: I am going to object. This is
21 backdooring hearsay evidence, whatever is contained in these
22 tax returns, which were prepared by it looks like various
23 accountants. It is, therefore, hearsay. As counsel even
24 acknowledged , these are tax returns that predate her tenure as
25 president of Country Club Park Development Company.
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1 MR. KEISLING: Your Honor, we don't agree that it
2 is hearsay. We are not admitting these to show that Country
3 Club Park Development Company, Inc., actually owned the
4 properties, we are showing them how they were treated for tax
5 purposes, which I think does not bring it within hearsay
6 because it is not for the truth of the matter.
7 But again, just as she is the current executor and
8 can speak to previous affairs of the estate, she is the current
9 president of the company and can certainly speak to tax
10 returns.
11 We understand she didn't sign them, however, we do
12 think it is relevant that she indicated to her knowledge the
13 only income from these have been from rental properties, so
14 these, again, show that Howard Gale during his lifetime,
15 getting back to our focus today, and his intent, his treatment
16 with Federal tax returns was the Country Club Park Development
17 Company, Inc., owned these properties and benefitted from the
18 rent.
19 THE COURT: Okay. Is there any question as to
20 authenticity of the returns?
21 MR. SEIFERTH: I am not disputing the authenticity,
22 Your Honor. I believe we were the ones that turned them over.
23 However, I think some of the conclusions that counsel is
24 raising about these documents, I think there are some issues
25 there. The documents say what they say. How the numbers were
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1 reached, who reached those numbers, who looked at what is what
2 I am having the hearsay problem with. That person is not
3 subject to cross-examination.
4 THE COURT: All right, the objection is noted but
5 overruled.
6 MR. KEISLING: Thank you, Your Honor.
7 BY MR. KEIS LING:
8 Q Now we are going to flip ahead a few years,
9 Mrs. Gale. To spare some of the discussion, and we will move
10 tc Petition er's Exhibit No. 40, this is very similar, can you
11 tell me the entity of this tax return?
12 A Country Club Park Development Company, Inc.
13 Q Here at the top?
14 A 2000.
15 Q Here, again, in the income section, we are showing
16 gross rents at No. 6, if that is correct, can you tell us the
17 --
18 A That is 198,249.
19 Q That is $198.249?
20 A Yes.
21 Q Again, this would have been from the rental of the
22 properties that we have already discussed?
23 A I suppose.
24 Q I will just direct you to page 6 of tree tax return.
25 Here we are in part 3, which is depreciation, and we show
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1 deductions for appreciation. Can you tell me what 17 shows,
2 the depreciation?
3 A 7,258.
4 Q On the back we have a chart that lists the
5 depreciation and it lists the different properties, and this is
6 the last page of the tax return. Can you just read the number
7 again?
8 A $7,258.
9 Q We would suggest that this is a chart of the
10 depreciation in the properties for 2000.
11 Let's do one more. This, again, Mrs. Gale, we will
12 rap up with these quickly.
13 A I hope.
14 Q Again, we already know that it is Country Club Park
15 Development Company, Inc.
16 A Yes.
17 Q The year of this?
18 A 2001.
19 Q Gross rents still listed --
20 A 81,511.
21 Q Again, we just want to make reference to the
22 depreciation of the property. Was there any other property
23 that Country Club Park Development Company, Inc., owned, other
24 than that which we are talking about?
25 A No.
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1 Q So when property is depreciated, it must be that
2 property, that is the only property we are discussing.
3 A Country Club Park Development Company, Inc.
4 Q Yes, ma'am.
5 Here I will show you again, 2C01, the same t ax
6 return --
7 A Yes.
8 Q It says depreciation and amortization. Can you
9 just read the number there?
10 A 7,259.
11 Q 7,259 is declared in depreciation. We don't have a
12 separate chart for that.
13 This is the last one we will do of these,
14 Mrs. Gale . I will show you, it is also for Country Club Park
15 Developme nt Company.
16 A Yes, 2002.
17 Q The gross rents here?
18 A 88,117.
19 Q We want tc switch tc the depreciation of the
20 property once again. Here we have depreciation, Part 3, can
2i you read that --
22. A 7,258.
23 Q That is pretty consistent with tree last coup le that
24 you have read --
25 A Yes.
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Q -- the same amount of depreciation?
A Yes.
Q Here we have on the very last page of the tax
returns, various properties listed, and here we are showing a
little bit more with that amount.
A 7,471.
Q But to your knowledge, this is 2002, once you were
president, any depreciation of properties must have been the
properties that we are discussing today?
A Yes.
Q Thank you, ma'am.
A Is that it?
Q Not quite, but we are very close, I promise you.
MR. KEISLING: Your Honor, if it pleases the Court,
we have exhibits that we plan to introduce that are
Pennsylvania corporate tax returns 1999 through 2005.
Again, they were provided to us by the estate. We
would simply ask if it is acceptable to Mr. Seifertl-i if the
Court at its leisure take notice that the depreciation amounts
and income amounts comport to the Federal tax returns, and we
will admit them, but we won't take Mrs. Gale's time to ask
questions about them.
THE COURT: Mr. Seiferth.
MR. SEIFERTH: Your Honor, I would just raise my
same hearsay objection on the record that I did with regard to
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Federal income tax.
THE COURT: All right. You are not contesting the
authenticity?
MR. SEIFERTH: No, Your Honor, I am not.
THE COURT: How have these been marked?
MR. KEISLING: These, Your Honor, are Petitioner's
Exhibit 46 through 52.
(Petitioner's Exhibit Nos. 46 through 52 were
marked for identification.)
THE COURT: All right.
MR. KEISLING: Your Honor, just to be thorough, in
case I didn't, although I believe I did, I formally moved for
the admission of Exhibits 46 through 52, the Pennsylvania
corporate tax returns.
THE COURT: Mr. Seiferth, I assume you have the
same objection?
MR. SEIFERTH: Just the hearsay objection, Your
Honor.
THE COURT: Petitioner's Exhibits 46 through 52 are
admitted.
MR. KEISLING: Your Honor, I am down to three
documents, and we will be able to conclude, sir. We would ask
that this be marked as Petitioner's Exhibit 53.
(Petitioner's Exhibit No. 53 marked for
identification.)
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1 BY MR. KEISLING:
2 Q Mrs. Gale, I am going to show you what is marked as
3 the inheri tance tax return. We will see if we can see where it
4 is dated.
5 THE COURT: Is this Petitioner's Exhibit 53?
6 MR. KEISLING: Yes, Your Honor.
7 THE COURT: All right.
8 MR. KEISLING: I apologize, and that is what
9 Mrs. Gale is looking at.
10 BY MR. KEI SLING:
11 Q Can you read the date that it has been signed?
12 A It looks like it is 8/1/ --
13 Q 8/10/04?
14 A Yes, I see it.
15 Q Signed by Mr. Trace?
16 A Robert J. Trace, yes.
17 Q And Attorney Trimmer, who was an attorney for the
18 estate --
19 A Yes, Mr. Trimmer, yes.
20 Q On this tax return, I am going to flip to the very
21 last page, and the very last page is a list of assets of
22 Country Cl ub Park Development Company, Inc. Can you tell me,
23 just count how many properties are there?
24 A 520 Colony Road; 7 Fargreen Road; Lot, Green and
25 Chestnut; North 32nd Street.
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1 Q So there are four properties listed here?
2 A I would say so, yes.
3 Q Flip back one page ar~d we have assets of the Howard
4 C. Gale Development Company, Inc.?
5 A Yes.
6 Q I am going to show you down here, do you see on the
7 list the disputed properties now appear on this list?
8 A Yes.
9 Q 222 Colony Road, do you see that property?
10 A 222 Colony Road.
11 Q And 22 Country Club Place?
12 A 22 Country Club Place, yes.
13 Q 6 Fargreen Road?
14 A 6 Fargreen Road.
15 Q 55 Circle Drive?
16 A 55 Circle Drive.
17 Q 49 Circle Drive?
18 A 49 Circle Drive, yes.
19 Q They now appear as assets of Howard C. Gale
20 Development on this tax return?
21 A Yes.
22 Q Do you have any knowledge of your own as to why
23 they cha nged from the first estate tax return to this?
24 A I don't know. As I told you, I was never involved
25 with the business. I have plenty of other things to do besides
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1 the business.
2 Q I certainly understand that. So you see that it is
3 here, but you have no knowledge as to why it appeared that way?
4 A Exactly.
5 MR. KEISLING: I would move for the admission of
6 the revised tax return, Petitioner's Exhibit 53.
7 MR. SEIFERTH: No objection.
8 THE COURT: All right, Petitioner's Exhibit 53 is
9 admitted.
10 (Petitioner's Exhibit No. 54 marked for
11 identification.)
12 MR. KEISLING: Your Honor, we would like to present
13 for marking Petiti.oner's Exhibit 54.
14 BY MR. KEISLING:
15 Q Mrs. Gale, I handed you Petitioner's Exhibit 54.
16 Do you recognize this document?
17 A Last Will and Testament.
18 Q Whose Last Will and Testament?
19 A I have never seen this to tell you the truth.
20 Q Can you tell me what it says on the top?
21 A Last Will and Testament of Julie F. Gale.
22 Q We are going to flip to the second page. Is there
23 a signature on that document, ma'am?
24 A Yes. That is my signature.
25 Q It is your signature?
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1 A Yes.
2 Q What is the date of the signature?
3 A 2002.
4 Q What month and date, if you can read it there?
5 A The lst day of August.
6 Q Is that your handwriting where it says lst day of
7 August?
8 A -- 2002.
9 THE COURT: What was the date?
10 MR. KEISLING: lst day of August 2002.
11 THE WITNESS: Yes, okay. That is my signature
12 there, yes.
13 BY MR. KEISLING:
14 Q Your handwriting for the lst and the word August?
15 A Well, unless I scribbled real quickly.
16 Q Before you take your glasses off.
17 A Yes.
18 Q Item 6 has two paragraphs. Could you just read for
19 me the second paragraph?
20 A The real estate in Country Club Park, Howard C.
21 Gale Development Company, Inc., that is held in trust for other
22 grandchildren of Howard C. Gale, Sr., is not included in this
23 item 6 and is specially noted as follows: 520 Colony Road, 530
24 Fairway Drive, 49 Circle Drive, 55 Circle Drive, 6 Fargreen
25 Road, 7 Fargreen Rcad, and 22 Country Club Park West.
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1. Q You recognize those properties as those that are
2 the subject of the dispute today?
3 A Yes, yes.
4 Q So at the time that you signed this document were
5 you under th e understanding that these properties belong to
6 Country Club Park Development Company, Inc.?
7 A No.
8 THE COURT: Was there an answer to that?
9 THE COURT REPORTER: The answer was no.
10 THE COURT: The answer was no. All right.
11 BY MR. KEISL ING:
12 Q Can you explain, Mrs. Gale, what you meant in your
13 own words by the language: The real estate in Country Club
14 Park that is held in trust for other grandchildren of Howard C.
15 Gale is not included in this item and especially noted as
16 follows, and then you list these disputed properties.
17 What did you mean. if you didn't think you were
18 setting asid e the properties that were in the dispute?
19 A I really don't know what to say, Your Honor.
20 Q So are you saying you don't know why you
21 specifically excluded the properties that are the subject of
22 this dispute ?
23 A I don't know what to say.
24 Q But you agree that you and I have both read it
25 correctly th at this document says --
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A Yes.
Q -- the disputed properties are held in trust for
the other grandchildren?
A It says there, yes.
Q The other grandchildren, who would that mean?
A The other grandchildren?
Q Yes, their names?
A It would be my grandson, Anthony Rossignoli.
Q Yes, Anthony, and then who are the other
grandchildren?
A Ellen; Jeffrey; Howard C. Gale, III; and Melissa.
Q Those are the children of Howard Gale, Jr. --
A Yes.
Q -- that he spoke of earlier?
A Yes.
Q So you are not sure why that clause is in there,
but if you were referring to the other grandchildren you would
mean those grandchildren and Anthony?
A Yes.
Q The clause above it, lists all of the real estate,
except for the properties that we have just read, and I will
point you down to the bottom, to Anthony E. Rossignoli?
A Rossignoli, yes.
Q Rossignoli, I apologize.
A Leisa J. Kercher is my daughter.
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Q So Item 6 of the will leaves all of your property
to your daughter and your natural grandson, forgive me, I don't
mean offense by that term.
A Yes.
Q Except, according to this, those properties that
were held in trust for the other grandchildren? That is what
it says?
A Yes.
Q Okay.
MR. KEISLING: Thank you.
Your Honor, the final document that we are looking
to present to the Court is simply the Certificate of
Incorporation for Country Club Park Development Inc., dated
October 19, 1956. As well as just a certificate of good
standing dated yesterday that just shows from 1956 through now
the corporation is in business in the Commonwealth. I would
move to have this be marked as Petitioner's Exhibit 55.
(Petitioner's Exhibit No. 55 marked for
identification.)
MR. KEISLING: Your Honor, I am actually not going
to ask any questions cf Mrs. Gale about this. I would simply
move fcr Exhibits 53, 54, and 55 to be admitted.
THE COURT: Mr. Seiferth, are you satisfied that
Petitioner's Exhibit 55 has been properly authenticated?
MR. SEIFERTH: Yes, Your Honor, I have no objection
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to 55. I don't think I have an objection to 53.
THE COURT: That was already admitted, and 54 and
55.
MR. SEIFERTH: 54, the Last Will and Testament of
Julie Gale, I would object to on the basis of relevance.
THE COURT: All right, Petitioner's Exhibits 54 and
55 are admitted. I have not admitted Petitioner's Exhibits 35
through 45. Were you moving for their admission?
MR. KEISLING: Yes, I would move for their
admission, Exhibits 35 through 45.
MR. SEIFERTH: Sorry, what numbers?
THE COURT: That is the tax returns, 35 through 45.
MR. KEISLING: The Federal tax returns.
MR. SEIFERTH: Yes. Your Honor, I objected to
those on the basis of hearsay, and I thought you had ruled on
that. If not, I would renew that objection.
THE COURT: Ail right, Petitioner's Exhibits 35
through 45 are admitted.
MR. KEISLING: Your Honor, forgive me if I lost
track, but just for clarity, I believe I have admitted 1
through 55. If not, I would formally do that now .in blanket
fashion. We have presented Exhibits 1 through 55, and I
believe I have them all admitted. I want to be extra safe,
Your Honor.
THE COURT: I believe they are all admitted.
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MR. KEISLING: Thank you.
THE COURT: Are you resting?
MR. KEISLING: We are resting, Your Honor. Thank
you, Mrs. Gale.
THE COURT: We don't want you to rest because we
haven't had cross-examination of this witness. How much cross
examination do you have?
MR. SEIFERTH: Very brief with her, judge, I have a
brief witness and some documentary evidence. I can't guarantee
I will have it done by 4:30, but it will be close.
THE COURT: We will adjourn for the evening and we
will enter this order: AND NOW, this 13th day of March, 2008,
upon consideration of the Petition for Declaratory Judgment
filed in the above-captioned matter and following an initial
day of hearing which has not yet been completed, the record
shall remain open and counsel are requested to contact the
Court's secretary for purposes of scheduling a further period
of hearing.
It is noted that as of the time of adjournment on
today's date the Petitioner had secured the admission of
Petitioner's Exhibits "1 through 55, and Respondent had secured
the admission of Respondent's Exhibit 1. No other exhibits had
been identified or admitted. It is noted further that at the
time of adjournment on today's date Petitioners were still
presenting their case-in-chief, and Julie F. Gale was being
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subjected to cross-examination by Respondent's counsel having
been called as of cross by Petitioners.
Okay, we will see you next time.
(Court adjourned at 4:23 p.m.)
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CERTIFICATION
I hereby certify that the proceedings are contained
fully and accurately in the notes taken by me on the above
cause and that this is a correct transcript of same.
Pa ricia C. rrett
Official Stenographer
The foregoing record of the proceedings on the
hearing of the within matter is hereby approved and directed to
be filed.
~~(A L. T~ vv s
Date
92